Welcome to the Chair Group Agricultural Production and Resource Economics!

Current Projects

SIGMA-Nexus - Sustainable Innovation and Governance in the Mediterranean Area for the Water-Ecosystem-Food Nexus

The overarching objective of SIGMA-Nexus is to develop climate resilience in the Mediterranean region by proposing sustainability pathways within the Water-Ecosystems-Food (WEF) Nexus framework. The four year project is funded by the Partnership for Research and Innovation in the Mediterranean Area (PRIMA) and the EU Horizon 2020 programme... more

VCFCSA - Value Chain Financing for Climate-Smart Agriculture in South Asia

VCFCSA, funded by the German Federal Ministry of Education and Research (BMBF), aims at identifying viable value chain financing models that strengthen the adoption of CSA technologies at the farm level in South Asia. The Chair Group of Production and Resource Economics will cooperate in the project with the Consultative Group on International Agricultural Research (CGIAR) in their Research Programme on Climate Change, Agriculture and Food Security (CCAFS)... more

EFFECT - Environmental public goods From Farming through Effective Contract Targeting

In the EU H2020 project EFFECT, the Chair Group of Production and Resource Economics, together with 19 partners from ten European countries, develops and tests innovative concepts for ecologically and economically effective agri-environment schemes... more

Current publications

Profitability Development and Resource Reallocation: The Case of Sugar Beet Farming in Germany

Wimmer, S. and J. Sauer (2020). Journal of Agricultural Economics

The 2006 sugar market reform in the European Union reduced minimum prices for sugar and sugar beets and introduced a voluntary restructuring scheme with buy back production quotas from sugar companies. Consequently, a restructuring of the entire sector occurred. In 2005/06, 189 sugar factories processed sugar beets produced on 305,000 farms; while in 2015/16, the number of factories declined to 109 (-42%) and the number of beet-producing farms to 140,000 (-55%). In our study that is now published in the Journal of Agricultural Economics, we analyze the consequences for German farms. Using data from the Farm Accountancy Data Network (FADN) with 1,940 beet producing farms, we assess the development of sugar beet profitability and sector productivity from 2004 to 2013. Our results show that an increase in total factor productivity (TFP) partly compensated for losses in terms of trade. A small portion of TFP growth can be explained by a reallocation of production from less productive farms towards more productive ones. Finally, we find that the contribution of production reallocation to sector productivity growth varied across regions with distinct ownership structures of sugar processing companies.

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Diversification economies in dairy farming – empirical evidence from Germany

Wimmer, S. and J. Sauer (2020). European Review of Agricultural Economics

This article explores how farm size is related to economic benefits from diversification. Using a data set pertaining to Bavarian dairy farms (2000–2014), we estimate an input distance function (IDF) to derive cost complementarities between distinct outputs. A Bayesian estimation technique is used to improve the theoretical consistency of the IDF. The results show that small dairy farms are more likely to benefit from diversification between milk and livestock production, while larger farms tend to benefit from diversification between milk and crop production. Both managerial and policy implications are discussed.

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Innovation and performance – evidence at micro level

Sauer, J. and H. Vrolijk (2019). Applied Economics

This empirical study aims to shed light on the link between innovation and economic performance at micro level. Based on a comprehensive survey among dairy and crop farms in the Netherlands we estimate a structural multi-stage model to deliver evidence on the effect of engagement and investment in innovation on the production of product, process and organizational or marketing innovations as well as on the effect of such innovations on farm level productivity. The results suggest various market and farm behaviour related factors to stimulate an increase in innovation engagement and production. Furthermore, the study reveals that indeed a greater innovation investment per unit (innovation input) leads to a higher probability of producing at least one successful product, process and/or organizational or marketing innovation (innovation output). The production of process and organizational or marketing related innovation leads to significant productivity gains. Various recommendations towards a more effective and efficient innovation policy are finally given.

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